mom and i sold houses together for over 22 years, until she retired in 2015. i have kept on selling houses. for sellers who are moving on, and to buyers who are moving in. real estate is such a part of our daily lives, that it carries over into everything we are. and it is of interest to so many people. so i thought i would start talking. who knows...i may actually find that i have something interesting to say :) www.tkmomteam.com

Monday, October 29, 2018

Rent or Buy: Either Way You’re Paying A Mortgage!

There are some people who have not purchased homes because they are
uncomfortable taking on the obligation of a mortgage. Everyone should
realize, however, that unless you are living with your parents
rent-free, you are paying a mortgage – either yours or your landlord’s.
As Entrepreneur Magazine, a premier source for small business, explained in their article, “12 Practical Steps to Getting Rich”:

“While renting on a temporary basis isn’t terrible,
you should most certainly own the roof over your head if you’re serious
about your finances. It won’t make you rich overnight, but by renting, you’re paying someone else’s mortgage. In effect, you’re making someone else rich.”

With home prices rising, many renters are concerned about their house-buying power. Mark Fleming, Chief Economist at First American, explained:

“Over the last three years, renter house-buying power has increased fast enough to keep pace with house price appreciation, so the share of homes that a renter can afford to buy has remained the same since 2015. Although mortgage rates are expected to rise, they are still low
by historic standards, and real household incomes are the highest they
have ever been. Assuming this trend continues, our measure of
affordability, which takes into account income, interest rates, and
house prices, indicates that homeownership is still within reach for renters.”

As an owner, your mortgage payment is a form of ‘forced savings’
which allows you to build equity in your home that you can tap into
later in life. As a renter, you guarantee the landlord is the person
building that equity.
Interest rates are still at historic lows, making it one of the best
times to secure a mortgage and make a move into your dream home. Freddie Mac’s latest report shows that rates across the country were at 4.51% last week.

Bottom Line

Whether you are looking for a primary residence for the first time or
are considering a vacation home on the shore, now may be the time to
buy.

Friday, October 26, 2018

Top 3 Myths About Today’s Real Estate Market

There are many conflicting headlines when it comes to describing
today’s real estate market. Some are making comparisons to the market we
experienced 10 years ago and are starting to believe that we may be
doomed to repeat ourselves. Others are just plain wrong when it comes to
what it takes to qualify for a mortgage.
Today, we want to try and clear the air by shedding some light on
what’s causing some of these headlines, as well as what’s truly going
on.

Myth #1: We Are Headed for Another Housing Bubble

Home prices have appreciated year-over-year for the last 76 straight months.
Many areas of the country are at or near their peak prices achieved
before the last housing bubble burst. This has many worried that we are
headed towards another housing bubble.Reality: The biggest challenge facing today’s real estate market is a lack of homes for sale! Demand is strong, as many renters have come off the fence and are searching for their dream homes.
Historically, a normal market requires a 6-month supply of inventory
in order for prices to rise with the rate of inflation. According to the
National Association of Realtors (NAR) there is currently a 4.3-month supply of inventory.The US housing market hasn’t had 6-months inventory since August 2012! The concept of supply and demand is what is driving home prices up!

Myth #2: The Rumored Recession Will Lead to Another Housing Market Crash

Economists and analysts know that the country has experienced
economic growth for almost a decade. When this happens, they also know
that a recession can’t be too far off. But what is a recession?Merriam-Webster defines a recession as “a period of
temporary economic decline during which trade and industrial activity
are reduced, generally identified by a fall in GDP in two consecutive
quarters.”Reality: Recession DOES NOT equal housing crisis.
Many people associate these two terms with one another because the last
time we had a recession it was caused by a housing crisis. According to
the Federal Reserve, over the last 40 years, there have been six recessions. In each of the previous five recessions, home values appreciated.

Myth #3: There is an Affordability Crisis Looming

Rising home prices have many concerned that the average family will
no longer be able to afford the most precious piece of the American
Dream – their own home.
There are many different affordability indexes supported by different
organizations that all measure different data. For this reason, there
is a lot of confusion about what “affordable” actually means.
The monthly cost of a home is determined by the home’s price and the
interest rate on the mortgage used to purchase it. According to Freddie Mac, interest rates have risen from 3.95% in January to 4.59% just last week.Reality: As we mentioned earlier, home prices have
appreciated year-over-year for the last 76 months, largely driven by
high demand and low supply.
According to a recent study by Zillow, the percentage of median income
necessary to buy a home in today’s market (17.1%) is well below the
mark reached in 1985 – 2000 (21%), as well as the mark reached in 2006
(25.4)! Interest rates would have to increase to 6% before buying a home
would be less affordable than historical norms.
The starter-home market has appreciated at higher levels (9.4%
year-over-year) than any other market. One reason for this is the fact
that many of the first-time buyers who have flocked to the starter-home
market are being met with high competition. For some hopeful buyers, it
may take more than a good offer to stand out from the crowd!

Bottom Line

There is a lot of confusion in today’s real estate market. If your
future plans include buying or selling, make sure you have a trusted
advisor and market expert by your side to help guide you to the best
decision for you and your family.

Wednesday, October 24, 2018

4 Reasons Why Fall Is A Great Time to Buy A Home!

Here are four great reasons to consider buying a home today instead of waiting.

1. Prices Will Continue to Rise

CoreLogic’s latestHome Price Insights report
reveals that home prices have appreciated by 6.2% over the last 12
months. The same report predicts that prices will continue to increase
at a rate of 5.1% over the next year.
Home values will continue to appreciate for years. Waiting no longer makes sense.

2. Mortgage Interest Rates Are Projected to Increase

Freddie Mac’s Primary Mortgage Market Survey shows
that interest rates for a 30-year mortgage have already increased by
half of a percentage point, to around 4.5% in 2018. Most experts predict
that rates will rise over the next 12 months. The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in unison, projecting that rates will increase by half a percentage point to around 5.1% by this time next year.
An increase in rates will impact your monthly mortgage payment. A year from now, your housing expense will increase if a mortgage is necessary to buy your next home.

3. Either Way, You Are Paying a Mortgage

There are some renters who have not yet purchased homes because they
are uncomfortable taking on the obligation of a mortgage. Everyone
should realize that unless you are living with your parents rent-free,
you are paying a mortgage – either yours or your landlord’s.
As an owner, your mortgage payment is a form of ‘forced savings’ that
allows you to build equity in your home which you can then tap into
later in life. As a renter, you guarantee your landlord is the person
building that equity.Are you ready to put your housing cost to work for you?

4. It’s Time to Move on with Your Life

The ‘cost’ of
a home is determined by two major components: the price of the home and
the current mortgage rate. It appears that both are on the rise.
But what if they weren’t? Would you wait?
Look at the actual reason you are buying and decide if it is worth
waiting. Whether you want to have a great place for your children to
grow up, you want your family to be safer, or you just want to have
control over renovations, maybe now is the time to buy.

If the right thing for you and your family is to purchase a
home this year, buying sooner rather than later could lead to
substantial savings.

Friday, October 19, 2018

Why are Existing Home Sales Down?

The latest Existing Home Sales Report issued by the National Association of Realtors
(NAR) revealed that home sales have decreased for four consecutive
months and are at their slowest pace in over two years. This has some
industry leaders puzzled considering the fact that the economy is
strengthening, unemployment is down, and wages are beginning to rise.
This begs the question: “Where are the buyers?”
Actually, agents in the field of most communities are still seeing
strong desire from prospective purchasers. They have a list of potential
buyers ready to go if the right houses come on the market and they
claim it is not a shortage of demand, but is instead a shortage of
inventory that is causing the market to soften.

Why is there a shortage of inventory?

You only need to look at the graph below to understand:

New construction sales over the last ten years are far below historic numbers from 1995-2002.
A recent industry report looked at building permits and concluded:

“If construction over the past decade matched
historic norms, accounting for population change, the country would have
had 2.3 million more single-family home permits.”

That decade of not building enough homes is the primary reason for the concerns about today’s market.

Wait, weren’t we talking about ‘existing’ home sales?

Some may argue that NAR’s sales report deals with existing home sales
and not new construction, and they would be correct. However, reports
have shown that one of the main reasons why existing homeowners are not
selling is because they can’t find homes that meet the needs of their
current lifestyles. Historically, the upgrades in a newly constructed
home were the answers to those needs.
Over the last decade, however, there were fewer homes built to
satisfy this move-up seller. Consequently, there are many homeowners who
stayed in their homes for a longer tenure, instead of putting their homes up for sale.

Bottom Line

As more new homes are being built, there will be more housing
inventory to satisfy current demand which will cause prices to moderate
and sales volumes to increase.

“Rents increased month-over-month in 62 of the
nation’s 100 largest cities, down significantly from the 85 cities that
saw rents rise last month. That said, rents are still up
year-over-year in most of the nation’s largest markets — 77 of the 100
largest cities have seen rents increase over the past twelve months.”

“Currently, nearly half (47 percent) of renter households are cost burdened (i.e., paying more than 30 percent of income for housing), while 25 percent (totaling 11 million households) are severely cost burdened, paying over 50 percent of their total household income for rent.”

These households struggle to save for a rainy day and pay other bills, including groceries and healthcare.

It’s Cheaper to Buy Than Rent

As we have previously mentioned, the results of the latest Rent vs. Buy Report from Trulia show that homeownership remains cheaper than renting with a traditional 30-year fixed rate mortgage in the 100 largest metro areas in the United States.
The updated numbers show that the range is an average of 2% less
expensive in Honolulu (HI), all the way up to 48.9% less expensive in
Detroit (MI), and 26.3% nationwide!

Know Your Options

Perhaps you have already saved enough to buy your first home. A nationwide survey of about 1,166 renters found that 34% said they rent because they cannot afford to buy, 29% said they cannot afford to buy where they live, and nearly a quarter (24%) were saving to buy.
Many first-time homebuyers who believe that they need a large down payment may be holding themselves back from their dream homes. As we have reported before,
in many areas of the country, a first-time homebuyer can save for a 3%
down payment in less than two years. You may have already saved enough!

Bottom Line

Don’t get caught in the trap that so many renters are currently in.
If you are ready and willing to buy a home, find out if you are able.
Let’s get together to determine if you can qualify for a mortgage today!

Monday, October 15, 2018

Home Prices: The Difference 5 Years Makes

CoreLogic recently released their Home Price Index Report. One of the key indicators used in the report to determine the health of the housing market was home price appreciation. CoreLogic focused on appreciation from July 2013 to July 2018 to show how prices over the last five years have fared.
The graph below was created to show the 5-year change in price from July 2013 to July 2018 by price range.
As you can see in the graph, the highest price appreciation occurred
in the lowest price range with 48% growth, while the highest priced
homes appreciated by 25%. This has been greatly fueled by the lack of
inventory of homes available at the lower price ranges and high demand
from first-time buyers looking to enter the market.

Where were prices expected to go?

Every quarter, Pulsenomics surveys a nationwide panel of
over 100 economists, real estate experts, and investment and market
strategists and asks them to project how residential home prices will
appreciate over the next five years for their Home Price Expectation Survey (HPES).
According to the Q3 2014 survey
results, national homes prices were projected to increase cumulatively
by 19.5% by December 2018. The bulls of the group predicted home prices
to rise by 27.8%, while the more cautious bears predicted an
appreciation of 11.2%.

Where are prices headed in the next 5 years?

Data from the most recent HPES shows that home prices are
expected to increase by 20.0% over the next 5 years. The bulls of the
group predict home prices to rise by 31.2%, while the more cautious
bears predict an appreciation of 9.3%.

Bottom Line

Every day, thousands of homeowners regain positive equity in their
homes. Some homeowners are now experiencing values even greater than
those before the Great Recession. If you’re wondering if you have enough
equity to sell your house and move on to your dream home, let’s get
together to discuss conditions in our neighborhood!

Wednesday, October 10, 2018

The Cost of NOT Paying PMI

Saving for a down payment is often the biggest hurdle for a
first-time homebuyer as median incomes, rents, and home prices all vary
depending on where you live.
There is a common misconception among homebuyers that a 20% down
payment is required, and it is this limiting belief that often adds
months, and sometimes even years, to the home-buying process.

So, if you can purchase a home with less than a 20% down payment… why aren’t more people doing just that?

“An insurance policy that protects the lender if you
are unable to pay your mortgage. It’s a monthly fee, rolled into your
mortgage payment, that is required for all conforming, conventional
loans that have down payments less than 20%.Once you’ve built equity of 20% in your home, you can cancel your PMI and remove that expense from your mortgage payment.”

As the borrower, you pay the monthly premiums for the insurance
policy, and the lender is the beneficiary. The monthly cost of your PMI
depends on the home’s value, the amount of your down payment, and your
credit score.
Below is a table showing the difference in monthly mortgage payment
for a $250,000 home with a 3% down payment and PMI vs. a 20% down
payment without PMI:
The first thing you see when looking at the table above is no doubt
the added $320 a month that you would be spending on your monthly
mortgage cost. The second thing that should stand out is that a 20% down payment is $50,000!
If you are buying your first home, $50,000 is a large sum of money
that takes discipline and sacrifice to save. Many first-time buyers save
for 5-10 years before buying their homes.
To save $50,000 in 10 years, you would need to save about $420 a
month. On the other hand, if you save that same $420 a month, you could
afford a 3% down payment in less than a year and a half.
In a recent article by My Mortgage Insider, they explain what could happen in the market while you are waiting to save for a higher down payment:

“The time it takes to save a (larger) down payment
could mean higher home prices and tougher qualifying down the road. For
many buyers, it could prove much cheaper and quicker to opt for the 3%
down mortgage immediately.”

The article went on to say,

“Since renters typically devote a higher percentage
of their income to housing than homeowners, providing flexible down
payment options can help renters with solid earnings purchase a home –
and gain a fixed-rate mortgage with principal and interest payments that
will not increase over the life of the loan.”

If the prospect of having to pay PMI is holding you back from buying a home today, Freddie Mac has this advice,

“It’s no doubt an added cost, but it’s enabling you
to buy now and begin building equity versus waiting 5 to 10 years to
build enough savings for a 20% down payment.”

Based on results of the most recent Home Price Expectation Survey,
a homeowner who purchased a $250,000 home in January would gain $50,000
in equity over the next five years based on home price appreciation
alone (shown below).

Bottom Line

If you have questions about whether you should buy now or wait until
you’ve saved a larger down payment, let’s get together to discuss our
market’s conditions and help you make the best decision for you and your
family.

Monday, October 8, 2018

Where Are Mortgage Interest Rates Headed In 2019?

The interest rate you pay on your home mortgage has a direct impact
on your monthly payment; the higher the rate, the greater the payment
will be. That is why it is important to know where rates are headed when
deciding to start your home search.
Below is a chart created using Freddie Mac’s U.S. Economic & Housing Marketing Outlook. As you can see, interest rates are projected to increase steadily over the course of the next year.

How Will This Impact Your Mortgage Payment?

Depending on the amount of the loan that you secure, a half of a
percent (.5%) increase in interest rate can increase your monthly
mortgage payment significantly.
According to CoreLogic’s latest Home Price Index, national home prices have appreciated 6.2% from this time last year and are predicted to be 5.1% higher next year.
If both the predictions of home price and interest rate increases
become a reality, families would wind up paying considerably more for
their next homes.

Bottom Line

Even a small increase
in interest rate can impact your family’s wealth, so don’t wait until
next year! Let’s get together to evaluate your ability to purchase your
dream home now.

Thursday, October 4, 2018

25% of Homes with a Mortgage are Now Equity Rich!

Rising home prices have been in the news a lot lately and much of
the focus has been on whether home prices are accelerating too quickly,
as well as how sustainable the growth in prices really is. One of the
often-overlooked benefits of rising prices, however, is the impact that
they have on a homeowner’s equity position.

Home equity is defined as the difference between the home’s fair
market value and the outstanding balance of all liens (loans) on the
property. While homeowners pay down their mortgages, the amount of
equity they have in their homes climbs each time the value of their
homes go up!
According to the latest Equity Report from ATTOM
Data Solutions, “13.9 million U.S. properties in Q2 2018 were equity
rich — where the combined estimated balance of loans secured by the
property was 50 percent or less of the property’s estimated market value
— representing 24.9% of all U.S. properties with a mortgage.”

This means that nearly a quarter of Americans who have a mortgage
would be able to sell their homes and have a significant down payment
toward their next home. Many who sell could also use their new-found
equity to pay off high-interest credit cards or help children with
tuition costs.
The map below shows the percentage of properties with a mortgage in each state that were equity rich in Q2 2018.

Bottom Line

If you are a homeowner looking to take advantage of your home equity
by moving up to your dream home, let’s get together to discuss your
options!

Tuesday, October 2, 2018

Mortgage Interest Rates are Still Going Up… Should You Wait to Buy?

Mortgage interest rates, as reported by Freddie Mac, have increased by close to a quarter of a percent over the last several weeks. Freddie Mac, Fannie Mae, the Mortgage Bankers Association, and the National Association of Realtors are all calling for mortgage rates to rise another quarter of a percent by next year.
In addition to the predictions from the four major reporting agencies mentioned above, the Federal Open Market Committee recently voted “unanimously to approve a 1/4 percentage point increase in the primary credit rate to 2.75 percent.” Historically, an increase in the primary credit rate has translated to an overall jump in mortgage interest rates as well.
This has caused some purchasers to lament the fact that they may no
longer be able to get a rate below 4%. However, we must realize that
current rates are still at historic lows.
Here is a chart showing the average mortgage interest rate over the last several decades:

Bottom Line

Though you may have missed the lowest mortgage rate ever offered, you
can still get a better interest rate than your older brother or sister
did ten years ago, a lower rate than your parents did twenty years ago,
and a better rate than your grandparents did forty years ago.

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About Me

i am a mom. and a wife. and a realtor. when i grow up i want to spend all day taking pictures and then spend all night looking at them. in the meantime, i am going to keep selling houses. for sellers who are moving on, and to buyers who are moving in. real estate is such a part of our daily lives, that it carries over into everything we are. and it is of interest to so many people. so i thought i would start talking. who knows...i may actually find that i have something interesting to say :)